Overview

The Superannuation Legislation Amendment (MySuper Core Provisions) Act 2012, enacted on 28 November 2012, was introduced to implement key aspects of the Government’s MySuper reforms, aiming to simplify and standardise superannuation products. The Act was proclaimed to commence on 1 January 2013 for certain provisions, and 1 July 2013 for the authorisation of MySuper products. The objective of the Act is to create MySuper products that are simple, cost-effective, and share common characteristics, replacing existing default superannuation products. The Act amends the Superannuation Industry (Supervision) Act 1993 to allow registrable superannuation entity licensees to apply to the Australian Prudential Regulation Authority (APRA) for authorisation to offer MySuper products, establishing rules for contributions, account transfers, fees, and the legislative basis for these fees. The transitional provisions ensure APRA has adequate time to process applications before the authorised licensees can offer MySuper products.

Scope and Application

The Superannuation Legislation Amendment (MySuper Core Provisions) Act 2012 applies to entities that are registered as superannuation fund licensees under the Superannuation Industry (Supervision) Act 1993, with a particular focus on those entities seeking to offer MySuper products. The Act is designed to implement key aspects of the Government’s MySuper reforms, which aim to standardise and simplify default superannuation products across the industry. The geographic reach of the Act is primarily within the Commonwealth of Australia, as it amends federal legislation and is subject to the oversight of the Australian Prudential Regulation Authority (APRA). The Act provides for a comprehensive framework that includes defining MySuper products, establishing rules for the payment of contributions and account transfers, and specifying permissible fees and their legislative basis. Exclusions and exemptions are not explicitly stated in the provided text, but it is implied that entities not registered as superannuation fund licensees are not subject to the Act's provisions regarding MySuper products. The Act's application can be further extended or refined through subordinate instruments issued by APRA.

Key Provisions

The Superannuation Legislation Amendment (MySuper Core Provisions) Act 2012 introduces significant changes to the Australian superannuation system through its operative sections, particularly those outlined in Schedule 1, items 3 to 14. These sections (3-14) amend the Superannuation Industry (Supervision) Act 1993 to facilitate the introduction of MySuper products. A MySuper product is a simplified, cost-effective superannuation option that aims to standardise default superannuation products across the industry. The Act allows registrable superannuation entity licensees to apply to the Australian Prudential Regulation Authority (APRA) for authorisation to offer these products. This authorisation process is governed by the rules set out in the Act, which also define the parameters for the payment of contributions, account transfers, and permissible fees. The Act imposes specific obligations on the parties it governs. Registrable superannuation entity licensees must adhere to the application process for APRA authorisation to offer MySuper products. They must ensure that their MySuper products conform to the statutory definitions and rules regarding contributions, account transfers, and fees. Furthermore, these licensees are required to comply with the fees regulations, ensuring they do not exceed the limits or bases prescribed by the Act. The Act also mandates that MySuper products meet the criteria of simplicity and cost-effectiveness, as intended by the Government’s MySuper reforms. Failure to comply with the provisions of the Act can lead to various consequences. While the Act itself does not explicitly detail the penalties for breaches, it operates within the broader framework of the Superannuation Industry (Supervision) Act 1993, which includes provisions for penalties. For instance, unauthorised offering of a MySuper product before the 1 July 2013 authorisation date could result in civil or criminal penalties, including fines and potential imprisonment for directors or officers of the entities involved. The precise penalties would be determined by the relevant courts based on the severity and nature of the breach. It is also worth noting that ongoing non-compliance could result in the revocation of APRA authorisation, effectively preventing the entity from offering any superannuation products, including MySuper.